AMD Might Be Working With Tesla On An AI Chip

Advanced Micro Devices, Inc. AMD spiked late Wednesday on news of a new Tesla Inc TSLA partnership. The microchip developer is helping Tesla develop a custom artificial intelligence chip to support autonomous vehicles, according to CNBC.

The collaboration and Tesla's resulting self-sufficiency are expected to draw business from NVIDIA Corporation NVDA, on which Tesla currently relies for graphics processing units. Nvidia fell slightly on the report.

AMD's role in Tesla's critical project testifies to the firm's reputation among tech peers. Tesla is investing in not only the chipmaker’s expertise but also its personnel, contributing a team composed of AMD veterans including a chip architect, principal hardware engineer and system circuit designer. AMD’s latest triumph builds on esteem earned earlier this year for its role in cryptocurrency mining.

On Tesla’s part, the firm’s commitment to developing in-house technology brings it level with self-driving car competitors. Alphabet Inc GOOGL, the parent company of Waymo, has already constructed two versions of an AI chip.

"Tesla's silicon project is bounding ahead under the leadership of longtime chip architect Jim Keller, the head of Autopilot hardware and software," CNBC's Jordan Novet reported. "Keller joined Tesla in early 2016 following two stints at AMD and one at Apple."

"More than 50 people are working on the initiative under Keller," the source told Novet. "Tesla has brought on several AMD veterans after hiring Keller, including director Ganesh Venkataramanan, principal hardware engineer Bill McGee and system circuit design lead Dan Bailey."

AMD closed up 4.7 percent and was trading more than 2 percent higher in the after-hours session. At time of publication, the stock was sitting at $14.20 per share.

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